Bank fraud is the use of fraudulent means to obtain money, assets, or other property owned or held by a financial institution. The are numerous variations of bank fraud, including credit card fraud, stolen and altered checks, check kiting, fraudulent loans, and wire fraud. Bank fraud is a pervasive and growing problem. For example, financial industry sources estimate that losses associated with credit card fraud are in the billions of dollars annually in the United States alone. The adverse effects of bank fraud are compounded by the different aspects of fraud and by the globalization of bank fraud, where fraud perpetrated in one country can victimize people in another country.
On an individual basis, a perpetrator can all-too-easily obtain important information of a victim. For example, a perpetrator can abscond with a victim's pre-approved credit card offer from the victim's mailbox or trash can. The perpetrator can then mail in the offer with a change of address request and start spending on the victim's bogus account. The perpetrator can even apply for a credit card in the victim's name if the perpetrator has the right information. The victim will not know a thing about the fraud until the credit card company tracks the victim down and demands payment for the purchases that the perpetrator has a racked up. With a victim's name, social security number, and date of birth, the perpetrator can get loans, access the victim's existing bank accounts, open new bank accounts, lease or buy cars, get insurance, and so forth.
Reducing bank fraud is consequently important to the preventing monetary losses to financial institutions and especially to bank customers, who often must expend substantial time in resolving the fraud and as well as experience psychological anguish.